'No One Can Be Trusted'... Series of Embezzlement Cases Occur Within Company

Embezzlement Occurs at Osstem Implant, Gyeyang Electric, LG Uplus, Clio, etc.
Self-Audit by Responsible Staff Not Allowed... "Must Be Reviewed Twice or Thrice"

[Image source=Yonhap News]

[Asia Economy Reporter Jang Sehee] Following Ostem Implant and Keyang Electric, large-scale embezzlement incidents have also occurred at LG Uplus and Clio. As embezzlement accidents have occurred even in large corporations, there are calls to supplement the lack of internal controls and the weaknesses in management system frameworks.

On the 26th, the Seongdong Police Station in Seoul announced that former Clio sales employee Mr. A was booked last month on the 7th on charges of violating the Act on Aggravated Punishment of Specific Crimes (embezzlement in the course of business). Clio revealed in its business report disclosed on the 23rd that an embezzlement incident involving one sales employee occurred last year. The employee in question has been dismissed.

Clio stated in the business report that the damage amount was 2,220,370,000 KRW, but the police currently estimate the embezzled amount to be 1,890,000,000 KRW.

LG Uplus filed a complaint yesterday with the Yongsan Police Station in Seoul against a team leader-level sales employee Mr. A on charges of breach of trust in the course of business.

Mr. A, who was in charge of multi-line sales of home products such as internet and Internet Protocol (IP) TV, colluded with dealerships to make fictitious contracts with fake customers and embezzled money by intercepting commissions paid by the company to the dealerships, according to the company's internal investigation results.

In addition, in January this year, a Grade 7 public official at Gangdong District Office in Seoul embezzled 11.5 billion KRW of public funds and used it for stock investment, and a Keyang Electric employee who was indicted on the 16th is known to have embezzled 24.5 billion KRW of public funds and squandered it on stock investments and gambling.

Most companies confirmed that they were unaware of the embezzlement by the employees until just before internal audits. Experts point out that internal systems should be strengthened twofold or threefold and regular monitoring should be conducted.

Professor Kwak Daekyung of Dongguk University’s Department of Police Science said, "It seems that during the audit, they just temporarily made the numbers match and passed it," adding, "Decisions related to money should not be made alone or within the department but should undergo double or triple audits." He added, "It is desirable to conduct external audits regularly at least once every six months."

Furthermore, Professor Kwak explained, "There needs to be a social perception change that seeking quick riches through asset investment without effort is risky," and "Strengthening economic and financial education from an early age is also a good method."

Meanwhile, according to the National Police Agency’s 'Major Economic Crime Occurrence and Arrest Status,' the number of embezzlement cases recorded 58,889 in 2020, significantly increasing compared to 26,767 cases in 2011.

This content was produced with the assistance of AI translation services.